Prop firm and futures glossary

Short definitions of the terms you'll meet in futures prop firm rules, written the way traders actually use them. Where a term has a full guide, the definition links to it.

Activation fee

A one-time fee some firms charge to turn a passed evaluation into a funded account. Apex charges it on standard evals, Topstep on its Standard path. Several firms charge none. See the 50K comparison.

Balance vs equity

Balance counts closed trades only. Equity also counts open trades at the current price. Most prop firms enforce their loss limits against equity, so an open loss counts before you close it.

Buffer

Profit you must build above a safety level before a funded account lets you withdraw. At MyFundedFutures it's the Max Loss Limit plus $100. See payout rules.

Consistency rule

A limit on how much of your profit can come from one day. Break it and your target usually rises rather than the account failing. See consistency rules.

Daily loss limit (DLL)

The most you can lose in one session. At most firms today hitting it pauses you until the next session rather than ending the account. See daily loss limit.

End-of-day (EOD) drawdown

A trailing drawdown that only moves on your closing balance. Open profit you give back during the day doesn't raise it. See EOD vs intraday.

Evaluation (eval, challenge, combine)

The paid test on a simulated account: hit the profit target without breaking the rules. Topstep calls it the Trading Combine, Take Profit Trader a test account.

Express Funded Account (XFA)

Topstep's funded account after the Trading Combine. It starts at a $0 balance. See Topstep.

Intraday drawdown

A trailing drawdown that follows your peak balance during the session, often including open profit. Stricter than end-of-day for traders who give back open gains.

Lock (drawdown lock)

The level where a trailing drawdown stops moving up, often the starting balance or the starting balance plus $100. After it locks, the floor is fixed.

Max Loss Limit (MLL)

The name Topstep, MyFundedFutures and Lucid use for the drawdown floor. Same idea as the trailing threshold at Apex.

Micro contract

A futures contract at one tenth the size of its E-mini, like MES for ES. Most firms count 10 micros as one mini. See micro vs mini.

Performance Account (PA)

Apex's funded account after a passed eval. It has its own contract tiers, daily loss limit and payout rules. See Apex.

Profit split

The share of withdrawn profit you keep. Typically 80% to 100% at the firms we track.

Profit target

The profit you need to pass an evaluation, usually 6% of the account. See profit target.

Reset

Starting the same evaluation over after a fail, usually for a fee. Apex evals have no resets; you buy a new eval instead.

Scaling plan

Contract limits that grow with your profit on a funded account. Apex PAs and Topstep XFAs both use one.

Tick and tick value

A tick is the smallest price move a contract can make; tick value is what that move is worth per contract. One ES tick is 0.25 points, worth $12.50. See the tick value calculator.

Trailing drawdown (threshold, floor)

A loss limit that follows your best balance up and never moves down. See trailing drawdown.